# Probability

• April 17th 2013, 04:19 AM
anna88
Probability
I have a problem I can't solve and I need help =)

I have this model
Attachment 27992
So=75 K=80 r=0,02 sigma=0,25 T=1
which gives me: ln(75/80)+(0,002-(1/2*o,252)*1/o,25*1 = -0,3032
Since its probability it can't be negative...??
• April 17th 2013, 12:10 PM
Shakarri
Re: Probability
Is part of that equation $(r-\frac{1}{2}\cdot \sigma^2)$ or $(r-\frac{1}{2\sigma^2})$ or $(r-\frac{1}{2})\cdot \sigma^2$ or $\frac{r-1}{2\sigma^2}$